Happy New Year! 2017 is here, the holidays are over, and many of us are slowly getting back into work. The festive season may simply be a welcome break for millions of Americans, but it is a crucial time for the economy, a chance to up sales and make money in the last few weeks of the year. So how did Christmas 2016 perform financially?
This year, the retail industry was taking no chances, with early sales and pre-Christmas deals set to catch the organised and the last-minute shopper alike. Up until the day itself, stores across America were offering discounts and promotions in a bid to prop up their bottom line and avoid, if possible, profit-margin-destroying left-over inventory post-festivities. This reflects a growing discipline among retailers, with many larger stores acting more quickly to close failing branches and only stocking as much inventory as they expect to sell.
And it is a tactic which seems to have paid off. The National Retail Federation originally predicted an uptick in both online and in-store sales of 3.6%, but this week companies such as Customer Growth Partners estimate the holiday sales growth as being as high as 4.9% for 2016. A recent Wall Street Journal report states that 2016 may have been the best shopping year for retailers since 2005, when sales increased by 6.1%.
This boost is credited to a combination of late-season and internet shopping, the latter of which increased by an estimated 19% over the holidays, according to a survey carried out by MasterCard. This may be good for the country’s sales overall, but department stores in particular have been badly hit by the public’s new preference for buying online. Retailers made a record $79.2bn from online sales between November 1st and December 20th, an increase of more than 10% on last year’s numbers. According to Accenture’s Annual Holiday Shopping survey, this year 84% of people said they planned to check Amazon before buying elsewhere – a trend which looks likely to grow in 2017.
So, in spite of the more than $1 trillion spent in this year’s holiday sales, the consumer’s love for – and often expectation of – a bargain, and the growing reliance on online stores to provide this could mean industry-defining changes for retail in 2017.
For questions about this, or any other financial matters, please reach out to us over Twitter or get in touch via telephone on 917-951-5170 or by email at firstname.lastname@example.org.